One popularly used component of social responsibility is philanthropy, which promotes the welfare of others through generous monetary donations to social causes. As an example of philanthropic giving, more and more managers are donating to an organization called The First Tee. The First Tee is a national, not-for-profit organization based in St. Augustine, Florida, and is the official charity of the PGA Tour. The goal of The First Tee is to build character among youth through the game of golf. Experiences in the program emphasize building core values like honesty, integrity, and respect for other youth. The First Tee has over 750 program locations around the world.

Overall, philanthropy aims to increase the well-being of people. Improving human welfare through philanthropy by businesses commonly includes donations geared toward supporting the arts, education, world peace, and disaster relief. Modern managers commonly must meet the challenge of designing and implementing an efficient and effective philanthropy focus.

When making philanthropic gifts, it is generally recommended that managers donate to causes that in some way will benefit the organization as well as society.²⁸ Managers should thus strive to make such gifts in societal areas that will afford the organization a competitive advantage in the marketplace. Consider the following examples of companies making philanthropic donations to enhance their competitive advantage:

1. ExxonMobil makes donations to develop infrastructure in underdeveloped countries. This infrastructure development improves the well-being of citizens of the countries along with helping the company to be more competitive by doing its business more effectively and efficiently within the countries.

2. Apple Computer commonly donates computers and other products to schools to help young people to become more computer proficient. Although such donations help human welfare, they also help students and teachers alike to become more computer sophisticated and better enabled to buy Apple products in the future.

3. American Express donates to secondary schools in underdeveloped countries to provide travel industry career training for students about to enter the labor market. This training improves the welfare of the students and also helps the company become more competitive by building expertise within the countries to provide travelers with mechanisms to use charge cards. Travelers are one of the main sources of revenue for American Express credit cards.

Critics often demean businesses because they view the philanthropic donations made to enhance competitive advantage as self-serving and not genuinely made to promote the well-being of others. Such criticism, however, is generally considered unfounded. Remember that the manager’s fundamental social responsibility is to stakeholders like employees, customers, and investors. Making donations to causes that do not somehow protect and enhance the continuity of the organization would be socially irresponsible because such donations would not support the well-being of the organization’s stakeholders.